Department Store

San Francisco – Gap Inc. experienced increases in cost of goods sold and operating expenses as sales fell during a difficult second quarter of fiscal 2015, resulting in substantial profit decline. Gap reported net income of $219 million, down 51% from $332 million in the same quarter the prior fiscal year.

Stage Stores Inc. lowered its profit forecast for the year and said it plans to close at least 90 underperforming stores as the retailer invests more on digital.

The retailer said it expects the closures to enhance its capital efficiency, deliver higher productivity and allow it to invest more money in the online sales product mix and technology in general.

Thanks to some financial engineering, Sears Holdings overcame a double digit decline in same store sales to produce a second quarter profit or a less severe loss depending on the arithmetic used.

Reagan era appointee David Stockman is no fan of the current administration or the Federal Reserve’s long-running easy money policy and to make his case against the flawed strategy he singles out four of the biggest names in department store retailing.

Stockman is the Reagan era director of the Office of Management and Budget who became a Wall Street executive and now regularly opines on the troubled state of the economy and looming dangers caused by nearly eight years of zero interest rates he contends have produced all manner of distortions in the economy.

Framingham, Mass. – Staples Inc. met Wall Street expectations with declining profit in the second quarter of fiscal 2015. Costs related to restructuring and the pending acquisition of Office Depot drove net income down 56% to $36 million, from $82 million in the second quarter of the previous fiscal year.

Net sales fell 5% to $4.94 billion, from $5.22 billion. North American store closures and unfavorable foreign exchange rates pushed sales totals downward. Same-store sales in North America (including online) fell 3%.

Target’s better than expected second quarter profits, same store sales, rate of e-commerce growth and an increased full year forecast stood in sharp contrast to the disappointing results Walmart reported a day earlier.

Minneapolis – Target Corp. exceeded Wall Street projections with net earnings of $753 million in the second quarter of fiscal 2015, a 221% increase from $234 million the same period the prior fiscal year. Declining selling, general and administrative (SG&A) expenses and loss from discontinued operations helped boost profits as sales climbed.

Target reported net sales of $17.4 billion, up 2.8% over the same period last year.

While Abercrombie & Fitch and Aeropostale continue to struggle against sharp sales declines, American Eagle has managed to win back shoppers, if its second quarter results are any indication.